Loan ‘fraud’: ED summons Anil Ambani on August 5, issues look-out notice

Sources said the ED has summoned Anil Ambani at its Delhi headquarters on August 5 for questioning. “We have also opened a LoC of Anil Ambani as a precautionary measure so that he would not travel abroad,” a source said.

On July 24, multiple teams of ED carried out searches at over 35 locations in Mumbai, and concluded their investigation on July 27.

While there was no response to the ED summons to Anil Ambani, a spokesperson for Reliance Power had earlier said in a statement, “The action by ED has concluded at all locations. The company and all its officials have fully cooperated and will continue to cooperate with the authority. Action by ED has no impact on the business operations, financial performance, shareholders, employees, or any other stakeholders of the company. The same appears to pertain to allegations concerning transactions of Reliance Communications Limited (RCOM) or Reliance Home Finance Limited (RHFL), which are over 10 years old.”

“Reliance Power is a separate and independent listed entity with no business or financial linkage to RCOM or RHFL. RCOM has been undergoing the Corporate Insolvency Resolution Process as per the Insolvency and Bankruptcy Code, 2016, for over six years. RHFL has been fully resolved pursuant to the judgment of the Hon’ble Supreme Court of India. Mr Anil D. Ambani is not on the Board of Reliance Power. Accordingly, any action taken against RCOM or RHFL has no bearing or impact on the governance, management, or operations of Reliance Power,” said the statement on July 27.

The ED probe has found alleged violations in Yes Bank’s loan approvals to the group’s companies, including backdated credit approval memorandums and proposals for investments made without any due diligence or credit analysis — violations of the bank’s credit policy, among other issues.

The ED has also alleged that Reliance Mutual Fund invested around Rs 2,850 crore in AT1 bonds of Yes Bank in a suspected quid pro quo arrangement. “These bonds were eventually written down, and money was siphoned off. This was the money of the public — the mutual fund investors,” a source alleged, adding that the CBI is also investigating the matter.

The money laundering case stems from at least two FIRs filed by the CBI and reports shared by the National Housing Bank, Securities and Exchange Board of India (SEBI), the National Financial Reporting Authority (NFRA), and Bank of Baroda with ED, sources said.

Last year, SEBI banned Anil Ambani and 24 other entities, including former key managerial personnel of RHFL, from the securities market for five years for alleged diversion of funds from the company. The regulator also slapped a Rs 25 crore fine on Anil Ambani for allegedly orchestrating a fraudulent scheme that adversely affected RHFL’s stakeholders, as well as confidence in the integrity of governance structures in regulated financial sector entities. The total penalty imposed on Anil Ambani and the other 24 entities works out to over Rs 625 crore.